McDonald’s closes lower Canal Street store, three months after Starbucks shutters

McDonald’s has closed its last restaurant on lower Canal Street in New Orleans, with the franchise owner citing “a multitude of reasons” for the shuttering less than three months after Starbucks closed its flagship store directly across the busy thoroughfare.

The local owner would not pinpoint any particular reason behind the move, made by the international chain’s corporate office, to close the outlet. He said it was a commercial decision to cease operations at 711 Canal, where McDonald’s opened in the 1990s.

“If you know McDonald’s, you know it takes a lot of reasons for them to decide to close a site,” said Christopher Bardell, who owns a dozen other McDonald’s franchises in the New Orleans area.

McDonald’s corporate office would not comment directly on the decision. It provided a statement saying, “McDonald’s reviews its restaurant portfolio on a regular basis to make the best decisions for our business moving forward. Closing a restaurant is a difficult decision, but we look forward to continuing to serve our customers at our other nearby McDonald’s restaurants.”

Tourism boosters, however, have been particularly sensitive to any signs that crime and violence have been driving business away from New Orleans. Violent crime in the city has garnered national attention and so worried local business leaders that they formed a coalition in July to lobby for a stronger response from City Hall and to raise money for programs to address underlying causes of crime. More than 400 businesses and other interested parties have joined the effort.

Three months after the coalition formed, Starbucks announced it was abandoning its store at 700 Canal, citing “security concerns” for local staff as a driving factor.

National trend

Still, McDonald’s has been shrinking its footprint across the United States; it now has has about 13,400 outlets, down about 1,000 over the past decade. The company has been targeting underperforming outlets for closure, including those that were located inside Walmart stores, as well as some that, like the one at 711 Canal, lack drive-through service.

Average sales per restaurant have risen 32% while McDonald’s closed 5% of its outlets over the past five years, the company reported in its annual letter to shareholders in April.

Closing 711 Canal wasn’t due to lagging sales or declining foot traffic, Bardell said. It had for many years been one of his busiest outlets.

Bardell, who started 42 years ago as a part-time operative at McDonald’s, bought his first three franchises in 2001: one in New Orleans East, one at 934 Canal and the 711 Canal Street outlet. All three are now closed.

He owns 12 others, including three in Mid-City, one Uptown on St. Charles Avenue, a branch in Faubourg Marigny and several in East Jefferson.

Improvements elsewhere

Trent Dang, spokesperson for the Downtown Development District, a taxpayer-funded agency with responsibility to improve security and enhance New Orleans’ business core, reckoned the McDonald’s closure likely was more to do with its lact of drive-through service than with security.

“Obviously, the location on Canal Street cannot offer that type of service,” Dang said. “We will work with the building owner to find a new tenant as soon as possible, as we work with many developers actively looking for downtown retail space.”

Dang also noted positive business developments along lower Canal, including the $325 million upgrade of the Harrah’s Casino and Hotel, which will be rebranded as a Caesars, and a program to invest $41 million in the Audubon Aquarium and Insectarium.

‘That block is cursed’

But David Rubenstein, long-time owner of Rubenstein’s clothing store across Canal from McDonald’s, said the persistent presence of loiterers has plagued the McDonald’s block, and frequent fights among them must have played in driving out the burger chain. He said several adjacent businesses also have closed.

“That block is cursed,” Rubenstein said.

Also, there have been some notable shootings by the McDonald’s. In November, an 18-year-old was shot and killed by another teenager a couple of doors down from McDonald’s during the annual Bayou Classic football game weekend. In 2019, several people were injured in a shoot-out between two young men inside the 711 Canal McDonald’s.

Bardell played down the issue of crime and security on the block.

“We’ve been having crime forever; sometimes it spikes, sometimes it goes down,” he said. “You’re going to have crime, and that’s the nature of the beast. It doesn’t scare me away at all. You have pockets of crime all over New Orleans.”

Nor was persistent vagrancy a deciding factor in terminating business at 711 Canal, he said: “You just have to keep running them off. After you run them enough, they knew where the boundaries were.”

A faulty awning

The McDonald’s location, and the building owner, were cited by the New Orleans Historic District Landmarks Commission in November for “demolition by neglect,” the culmination of city proceedings that date back to 2019. City Hall would not comment on the judgment beyond what is in the public record, which mentions an unfixed awning.

Bardell said the citation involved longstanding damage to the awning on the Royal Street side of the premises, which was deemed to be hazardous to the public. He said it wasn’t a factor in the McDonald’s closure and is an something that Starwood Capital Group, owner of the Crowne Plaza hotel, which owns the building covering the entire block, was supposed to address. Starwood didn’t respond to requests for comment.